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Last Updated: Monday, 26 July, 2004, 09:40 GMT 10:40 UK
Customer number boost at Vodafone
Vodafone shop front
Vodafone has reported a bigger-than-expected rise in customer numbers, but problems remain at its Japanese unit.

The firm said user numbers had grown by 3.1 million during the April to June period, and that the total number of global subscribers was 139.3 million.

However, Vodafone said revenue in Japan remained under pressure reflecting the "competitive environment".

Chief executive Arun Sarin said the mobile giant may now decide to return more cash to shareholders.

Speaking to reporters, Mr Sarin said the company's board was "minded to increase the payout" to shareholders.

This could take the form of Vodafone stepping up its share buyback programme or paying extra dividends.

In May, Vodafone announced a 3bn share buyback programme, and Mr Sarin said one-third of that had already been completed.

Battle for custom

Vodafone's global subscriber figures were helped by the addition of 2.7 million users after the company bought out minority shareholders in its Japanese unit Vodafone Holdings KK earlier this year.

But the key average revenue per user figure (ARPU) fell in Japan by 2,330 yen to 78,365 yen during the quarter.

Vodafone blamed the fall on tough competition and also on a rise in the number of less-lucrative prepaid customers.

There was better news from the UK where ARPU rose by 5 to 314.

In Italy, ARPU was up by one euro to 362 euros, while in Germany it fell one euro to 309 euros.

"Overall we feel we have made a very strong start to this year," said Mr Sarin.

"We have recorded good performances in both customer and revenue growth.

"With over 139 million proportionate customers, our business is progressing well, despite a tougher competitive environment in some markets."

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